In the News

Naturally, most waterfront dwellings aren’t owned by the poor. If you don’t count 2005, the year of hurricanes Katrina and Rita, in the years from 1998 to 2008, the wealthiest counties in the country filed 3 1/2 times more claims and received more than a billion dollars in claim payments than the poorest counties, reported the Institute for Policy Integrity.

In a similar way, the dean of NYU’s law school, Richard Revesz, and his colleague Michael Livermore argue that the REINS Act puts undue emphasis on the “costs” of regulation. On the Huffington Post, they write:

“By focusing exclusively on the downsides of regulation, and not the benefits, the implication of this proposed legislation is that protecting the health and safety of Americans is not worth the costs that regulated entities must pay. But in fact, the opposite is often true: These rules can produce billions of dollars in net benefits.”

Jason Schwartz, legal director for the Institute for Policy Integrity, said Friday that an additional requirement of the REINS Act that puts a time limit on how long Congress has to consider a major new rule is especially troubling.

“Congress does not need the REINS Act to help it review rules, and in fact the REINS Act is not likely to help Congress review rules; the more likely fate for rules will either be a pro forma approval by Congress, which just adds an unnecessary step to the already lengthy rulemaking process, or else death by congressional inaction or political bickering,” Schwartz said.

Considered collectively, President Obama’s clean air rules will have relatively small negative impact on the economy and a major positive impact on health and the environment. Those claiming otherwise are likely looking only at the costs of these clean air regulations and not considering the benefits.

How does the Obama administration’s pace on new regulations compare to those of previous administrations? During today’s OnPoint, Michael Livermore, executive director of the Institute for Policy Integrity at the New York University School of Law, explains why he believes the Obama EPA’s rollout of new rules is in line with previous administrations. Livermore also discusses why this round of air regulations has garnered so much attention.

“Industry will favor that approach, states will favor it, environmental groups will favor it—and we believe the EPA has the legal power to do it,” says Michael Livermore, a law professor at New York University and the executive director of the Institute for Policy Integrity. The IPI released a paperr earlier this year that makes the case that the EPA has power under the Clean Air Act to recognize state cap-and-trade programs. “The only question,” says Livermore, “is how risk-averse the EPA is.”

Tuesday’s announcement could be the last best chance, said Michael Livermore, executive director of the Institute for Policy Integrity. “One granting programme obviously isn’t going to be a game changer in terms of advanced biofuels,” he said.

Cutting the $6bn subsidies for corn ethanol would be a far bigger boost. But Livermore added: “It’s kind of a reality test to ensure that there is genuine interest and this is not just a government boondoggle. If they don’t show interest, it is a real sign that maybe this isn’t such a good avenue in the future.”

President Obama’s recent announcement of new fuel economy standards will help reduce U.S. dependence on foreign oil, save drivers money at the pump, and curb harmful emissions and pollutants.

But the effectiveness of the standards will depend on the details and implementation—too many loopholes and the benefits could be watered down. For example, overly generous credits for electric cars might be good for battery makers, but will reduce the environmental and consumer savings of the rule if it causes lower-cost efficiency technologies to sit on the shelf.

A.E.P. shuttering its attempt at carbon capture and sequestration (CCS) technology is a good example of the consequences of the lack of clear signals from the government on climate change policy. Potential innovations like these will continue to fall by the wayside unless there is a meaningful sign from Washington that clean energy requirements are on the horizon.

Without a penalty for carbon emissions, the return on investment for CCS projects is non-existent. Why would profit-seeking companies incur extra costs when they don’t have to? Unless businesses are not required to foot the bill for the environmental damage they cause, there is no reason to expect that one morning they will wake up and start spending shareholder money to contribute to the public good.